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BPP P5 Exam tips for June 2009 session BPP P5 Exam tips for June 2009 session ACCA Paper P5 - Advanced Performance Management June 2009 Exam Tips and Useful Articles This exam and examiner are not predictable. Just because a topic featured in the last exam doesn’t mean it won’t feature this time. The examiner has already tested some syllabus areas more than once (and at consecutive sittings), whilst other topics remain unexamined. Use the following tips as important areas to cover, but remember that no one knows what is in the exam, apart from the examiner. Also remember that much of the paper (up to 70%) is compulsory, and your choice is limited even in the optional section, so your safest bet is to achieve good syllabus coverage in your revision, as the examiner aims to do in the exam. The following is a guide to areas that you should include as part of your revision: Section A: Scope of strategic performance measures in the private sector Financial data has appeared repeatedly in the previous syllabus exams and on all the real exams to date, so it would be surprising if it were not included here. You may be asked to draw up an income statement or budget or to compare actual performance against a benchmark. This could include the use of activity-based approaches, learning curves or optimal pricing. Once the financial data has been collated and compared, questions usually include the need to comment on these and may require discussion of non-financial indicators, additional information to improve assessment or strategies to improve performance. 2009 P&R Kit Questions: Q30 Quicklink, Q31 GWCC, Q32 SEC, Mock exam 3 Q3 SSH. Divisional performance and transfer pricing issues This chapter has been a key issue in P5 exams so far, often appearing as a compulsory question. Transfer pricing has not yet been tested in a full question but has appeared both as part of optional questions, numerically, and part of the smaller compulsory question, discursively. Given that the P5 syllabus covers world economics and fiscal policy, it may be tested in an international context. 2009 P&R Kit Questions: Q36 NAW Group, Q38 CD (a), Q39 Alpha division, Q40 HFG. Risk Either of the two questions in Section A could be set in the context of a risky decision. This could link to suggestions of strategies to reduce risk or could encompass numerical evaluation of the risk involved and the likelihood of this being acceptable to management using probabilities, risk appetite or sensitivity analysis 2009 P&R Kit Questions: Q4 HEG, Q5 CTC, Q38 CD (b), Mock exam 2 Q1 Wonderland. Section B: At least one question in this section will be entirely discursive. It could well cover: Current developments / trends in management accounting Many of the modern management and management accounting techniques have been examined here with both JIT and TQM common topics in the previous syllabus. Knowledge of these was used to discuss the impact they would have on information systems or performance measures. 2009 P&R Kit Questions: Q60 Costs and quality, Q61 Management Accounting Relevance, Q30 (d) Quicklink. Alternative approaches to budgeting for control Budgeting has long been a favourite essay question with your examiner, but missed out in 2008. 2009 P&R Kit Questions: Q10 Better Budgeting, Q11 Budgeting. Management accounting and information systems A question on sources of information, relevance of operational management accounting information in today’s business environment or types of management information system is a likely choice at this sitting as it has not yet been tested in depth at P5. 2009 P&R Kit Questions: Q4(c) HEG, Mock exam 1 Q2 Moffat. Questions that may contain some numerical information might cover: Alternative views of performance measurement The examiner often includes a question to evaluate an organisation against an established theoretical model. The balanced scorecard, performance pyramid and building blocks have all appeared in previous exams. 2009 P&R Kit Questions: Q49 Eatwell Restaurant, Q51 GER, Mock exam 2 Q5 Bettaserve, Mock exam 3 Q1TSC. Performance hierarchy Linking strategic decisions to mission statements or suggesting strategic options using models such as Ansoff’s matrix or the BCG matrix lend themselves to questions containing a mixture of financial and discursive elements 2009 P&R Kit Questions: Q34 Vision, Mock exam 3 Q3 TMC. Useful Articles: If you want to read around the subject or improve your understanding, there are a number of articles on the ACCA website. Shane Johnson (your examiner) has promised to write articles on the new elements of the syllabus, prior to examining them, so more articles may appear between now and the date of the exam. Check the ACCA website between now and the exam for new articles. They may be tips for June! There have not been any articles published in 2009 to support your study for P5, but the following articles remain relevant to the P5 syllabus. Some of these were written to support the previous ACCA paper, paper 3.3, which was also written by the P5 examiner. Many others are available on the ACCA website. ‘Business failure’ by Michael Pogue, the P5 assessor, outlines methods to predict and thus prevent failure and highlights the key causes of corporate failure – management. ‘Economic Value Added’ by Shane Johnson and Matt Bamber outlines the advantages of an economic value added approach to performance measurement. ‘Defining managers’ information requirements’ by Jim Stone describes the use of critical success factors. ‘Management control - a pre-requisite for survival’ by Shane Johnson explains why increasing recognition is given to satisfying the needs of different stakeholders. ‘Performance measures to support competitive advantage’ by Graham Morgan uses the success of airlines such as EasyJet and Ryanair to examine how the balanced scorecard might be utilised to maintain the low-cost carriers' competitive edge. ‘The pyramids and pitfalls of performance measurement’ by Shane Johnson, outlines the issues which are central to the understanding and assessment of performance measurement. ‘Business strategy and performance models’ by Shane Johnson provides a brief overview of three models to assist accountants in the determination of business strategy and in the appraisal of business performance. ‘Examiner's approach to Paper P5’ by Shane Johnson, provides his approach to the Advanced Performance Management exam.